boston.com News your connection to The Boston Globe
WEB EXCLUSIVE

Oil in Africa

Q&A with The Globe's John Donnelly

The fate of Africa's huge crude oil reserves is important not just for Africans but also for Americans -- who already use millions of barrels of oil imported from Africa every day. The Boston Globe's Africa bureau chief, John Donnelly, has written a three-part series about the issue. Here is a summary of the key points in the series, in question-and-answer form.

Q: How does Africa's oil affect Americans?
A: The United States currently receives more than 15 percent of its oil imports from sub-Saharan Africa. The US National Intelligence Council estimates that the percentage will probably increase to 25 percent in the next decade as Africa continues to discover new offshore oil reserves. And the importance of African oil is growing: in the last five years, Africa's west coast accounted for about one-third of the world's new oil discoveries.

Q: Why is African oil attractive?
For the United States, Africa's oil also is useful because it is mostly "sweet" crude, with low sulphur content, which is easier and cheaper to refine into gasoline or other products. Also, transportation costs to the US East Coast are lower from Africa than from the Middle East because the distance is shorter for supertankers.

Q. How does oil help Africans?
A: The vast amounts of income from oil have often made the ruling classes rich but done little for the vast majority of African people. In each oil-rich country along the Gulf of Guinea -- Nigeria, Gabon, Equatorial Guinea, Republic of Congo and Angola -- more than 50 percent of the populations live on less than $2 a day.

But as more oil is discovered in Africa, activists have increased pressure on the governments to use their oil wealth to improve education, health, and infrastructure. Compared to even five years ago, African countries face much greater scrutiny today on oil spending.

Q: How much money are they pulling in?
A: Take Angola as one example. It expected $6 billion in oil revenues this year. But the spike in oil prices, which for a while pushed a barrel of crude over $60, means that the government likely will earn $10 billion this year. And now the country hopes to expand production from 1.3 million barrels of oil a day to 2 million by 2008. After decades of civil war, Angola has been at peace since 2002 and will hold elections next year. So some hope the oil wealth could contribute to the rebuilding.

Q: How does the corruption occur?
A: Consider Nigeria: One of Nigeria's challenges is that its oil isn't off-shore, as in Angola. It is underneath the swamps of the Niger Delta, a densely populated and environmentally sensitive region in the country's southeast. The government's own anti-corruption watchdog commission estimates that 45 percent of Nigeria's oil is wasted or stolen, often by criminal gangs operating in the swamps of the delta. Sabotage occurs daily on oil lines in the delta: residents use hacksaws to cut through pipes, and sophisticated thieves tap into pipelines and divert thousands of barrels of oil a day into waiting tankers. This theft often causes oil spills in the delta, damaging the fish population.

Q: Is anyone making progress against corruption?
A: The Republic of Congo-Brazzaville has put thousands of documents on the Internet, but even international accountants have a hard time deciphering the information. The government hopes the International Monetary Fund and World Bank will forgive much of its billions of dollars in debt. But investigators found glaring holes between what the government received in oil money and its expenditures. In addition, some senior officials also run private oil trading companies. The officials appear to sell the country's oil to themselves and then peddle it to legitimate oil traders.

SEARCH THE ARCHIVES
 
Today (free)
Yesterday (free)
Past 30 days
Last 12 months
 Advanced search